Metalloinvest announces the pricing of a 25 billion ruble bond issue

Metalloinvest, a leading global iron ore and HBI producer based in Russia, today announces the pricing of a 25 billion ruble bond issue.

On March 15, 2012 Metalloinvest Holding Company JSC closed the books for the placement of its debut non-convertible interest-bearing documentary bonds of the 01 and 05 series with a total amount of RUR15 billion (c. USD508 million). The bonds mature in 10 years (3,640 days) with a put option in 3 years (1,092 days). As a result of the placement the coupon rate was set at 9.00% per annum, which is below the bottom of earlier announced price range of 9.50-10.0%.

Russian and international investors placed 98 orders for the series 01 and 05 bonds with the book totaling RUR48 billion. As a result, the book was oversubscribed c.3.2x times.

On March 16, 2012 Metalloinvest Holding Company JSC closed the book for the placement of its debut non-convertible interest-bearing documentary bonds of the 06 series with a total amount of RUR10 billion (c. USD338 million). The bonds mature in 10 years (3,640 days) with a put option in 3 years (1,092 days). As a result of the placement the coupon rate was set at 9.00% per annum.

Russian and international investors placed 52 orders for the series 06 bonds with the book totaling RUR27 billion. As a result, the book was oversubscribed c.2.7x times.

Settlements for the series 01 and 05 bonds will take place upon bond placement on MICEX on March 19, 2012, and on March 22, 2012 for the series 06 bonds. Secondary trading is expected to commence on April 12, 2012. Both issues are expected to be included into the Lombard list of the Central Bank of Russia.

Troika Dialog and VTB Capital are acting as Lead Managers and Joint Bookrunners on Metalloinvest Bonds Offering. Globexbank, Alfa-Bank and Ronin are acting as Co-Managers. Bank Zenit and Region Investment Company are underwriters of the placement.

Pavel Mitrofanov, Deputy CEO and Chief Financial Officer of Metalloinvest Management Company stated: “We consider that the results of this placement are proof of the high level of investor trust due to key factors: firstly, the high quality of the Company’s assets, which are recognised and valued by primary investors, and secondly, the Company’s strong market positions as a major global producer of iron ore and HBI”.

“We regard the placement made by Metalloinvest as very successful, remarked Olga Gorokhovskaya, DCM Director at Troika Dialog. “The unprecedented high investor demand and successfully selected placement time – during book building the volume of orders exceeded RUB48 billion – allowed us to open the book the next day for an additional RUB10 billion and successfully close it within a few hours,” she added.

Alexey Konochkin, Head of Local DCM at VTB Capital, said: «The debut Metalloinvest ruble bond offering is a landmark transaction on the local debt capital market. Strong demand from a diversified pool of investors not only allowed to lower the indicative coupon range twice during the marketing, but also to increase the initial deal size by 2.5 times. This is truly unprecedented success».